CoinTracker’s upgraded accounting engine allows users to more accurately account for fees paid on exchanges or blockchains for crypto transactions. Fees can affect both your cost basis and proceeds, and therefore the ultimate gain or loss calculations.
(Remember, capital gains/loss = proceeds - cost basis)
Example 1: You transfer 1 ETH and pay a 0.1 ETH gas fee.
The cost basis of 0.1 ETH is $10. The market value of 0.1 ETH at the time of spending for gas is $30.
- Cost basis of 1 ETH before transfer is $1,000
- Gain on 0.1 ETH disposal on gas fees $20 ($30 - $10)
- The new cost basis 1 ETH after transfer $1,030 ($1,000 + $30)
Example 2: You sell 1 ETH for $1,000 and pay a $30 gas fee
- The proceeds on the sale of 1 ETH will be $970 ($1,000 - $30)
Example 3: You buy 1 ETH for $1000 and pay a 0.2 ETH gas fee from an existing ETH lot you had.
The cost basis of 0.2 ETH is $10. The market value of 0.2 ETH at the time of spending for gas is $60.
- Cost basis of 1 ETH is $1,000
- Gain on 0.2 ETH disposal on gas fees $50 ($60 - $10)
- The total cost basis of 1 ETH is $1,060 ($1,000 + $60)
CoinTracker also encourages all users to consult with independent financial advisors with any questions.
Disclaimer: This post is informational only and is not meant as tax advice. For tax advice please speak with a tax professional. See our full disclaimer by clicking here.